Oil execs warn of long-term damage from Iran war as US downplays crisis

Executives say energy shocks could slow global growth and raise living costs. (Photo/Reuters)

Some of the world's top oil executives and energy ministers in Houston expressed growing concern over the long-term effects of the US-Israel war on Iran on the global economy, while the US Energy Secretary Chris Wright downplayed the crisis.

The war has caused one of the biggest disruptions to energy supplies in history after Iran effectively closed the Strait of Hormuz shipping route, while attacks in the Middle East have damaged production infrastructure in several countries.

Global benchmark Brent crude stood at $99 a barrel on Monday afternoon, even after a sell-off following remarks by President Donald Trump that he was in talks with Iranian officials to end the conflict.

"The consequence is not only high energy prices. It will damage other supply chains," said Patrick Pouyanne, CEO of TotalEnergies, pointing to disruptions in helium shipments used in semiconductors and medical supplies.

Speaking at the CERAWeek conference in Houston, Wright said oil prices had not yet risen enough to hurt demand, despite gasoline prices increasing by more than 30 percent to nearly $4 a gallon in the US since the conflict began.

More than 10,000 attendees from over 80 countries gathered at the conference, which has coincided with a major global energy disruption for the second time in five years.

Executives warn of impact

Shortly after Wright's remarks, ADNOC chief Sultan Al Jaber warned that rising oil prices were slowing global economic growth.

"This is raising the cost of living for those who can least afford it and slowing economic growth everywhere," he said.

Ben Marshall, CEO of Vitol Americas, warned that demand could fall sharply if oil reached $120 a barrel.

The war has disrupted flows through the Strait of Hormuz, which carries about one-fifth of global oil and gas supplies, while key infrastructure in the Middle East has been damaged.

Chevron CEO Mike Wirth said the full impact of the disruption had yet to be reflected in oil prices.

"It will take time to come out of this," he said.

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Source: TRT